Coinbase (NASDAQ:COIN) has secured an Anti-Money Laundering (AML) registration with the Bank of Spain as a cryptocurrency exchange and custodian wallet provider. The move is expected to bolster its position in Europe and is part of Phase II of the crypto exchange’s “Go Broad, Go Deep” strategy for international expansion.
Coinbase Focuses on International Expansion
By gaining Spain’s AML registration, Coinbase can now offer its users custody of crypto assets, allow buying or selling crypto assets in legal tender, and the trading of crypto assets against other crypto assets.
Coinbase highlighted that cryptocurrencies are now the second most popular payment method in Spain, surpassing bank transfers. The company also noted that as per a research report by Bitnovo, 60.7% of Spanish citizens are inclined to buy cryptos for long-term investments, while 35.7% intend to use them to make payments.
A key aspect of the company’s Phase II international expansion is to focus on acquiring licenses and registrations and entering into local partnerships. Aside from the EU, Coinbase is also keen on other international markets like Canada, Brazil, Singapore, and Australia.
The company is focused on strengthening its operations in ”Go Deep” markets that are establishing clear crypto rules, as in the case of Spain. Coinbase thinks that the recent adoption of the Markets in Crypto-Assets Regulation (MiCA) by the European Union makes the region favorable for cryptocurrencies and crypto firms.
Regulatory Woes in the U.S.
Coinbase’s appreciation for the clarity of regulations in the European Union comes at a time when the company is facing heightened regulatory scrutiny in the U.S. In a September 6 blog post, the company expressed its disappointment with the lack of regulatory clarity in the U.S., saying, “We’re committed to helping to update the global financial system and providing more economic freedom and opportunity, and won’t stand idle just because the U.S. is.”
Meanwhile, the fight between the U.S. Securities and Exchange Commission (SEC) and Coinbase continues to intensify. As per Bloomberg, the SEC has raised concerns over Coinbase’s proposed involvement in crypto lending firm Celsius Network’s plan to emerge from bankruptcy.
Under the plan, Celsius, which filed for bankruptcy in July 2022, agreed to engage Coinbase to distribute assets to its international customers. However, in a filing on Friday, the SEC argued that the agreements between the two companies “go far beyond the services of a distribution agent, contemplating brokerage services and master trading services that implicate many of the concerns.”
Earlier this year, the SEC filed a lawsuit against Coinbase, alleging that the company was operating as an unregistered securities exchange, broker, and clearing house.
Is Coinbase a Buy or Hold?
Wall Street is sidelined on Coinbase stock, with a Hold consensus rating based on six Buys, nine Holds, and six Sells. The average price target of $82.74 implies 15.3% upside. Despite regulatory pressures, shares have rallied 103% year-to-date.
